Cheney Was Referring to the Bush Tax Cuts When He Said, ‘Reagan Proved Deficits Don’t Matter’ – But Even Bush Had Doubts about Them in 2002

O'Neill, Cheney
O'Neill, Cheney
Eight years ago this month, George W. Bush’s first secretary of the Treasury, Paul O’Neill, was asked to resign. O’Neill, the former CEO of Alcoa, had made a couple of gaffes, including one that temporarily caused a run on the dollar. But it was his opposition to the administration’s plan to give tax cuts to the wealthy — O’Neill worried the cuts might cause the federal deficit to balloon out of control — that got him canned.

Not long after O’Neill left office, author Ron Suskind wrote a book about O’Neill’s tenure as Treasury secretary titled, “The Price of Loyalty: George W Bush, the White House, and the Education of Paul O’Neill.” The book made headlines when it was published in late 2003, because, in it, O’Neill became the first high-ranking official from the administration to say publicly that war with Iraq had been a top objective of the Bush administration from the outset, and that the Sept. 11 attacks had merely provided a pretext for the invasion.

“Haven’t we already given money to rich people? This second tax cut’s gonna do it again. Shouldn’t we be giving money to the middle?”
– Bush in 2002

(It was also around this time that Ron Suskind reported on a conversation he’d had with an anonymous senior White House aide — now universally thought to have been Karl Rove. “The aide said that guys like me,” Suskind wrote, “were ‘in what we call the reality-based community,’ which [Rove] defined as people who ‘believe that solutions emerge from your judicious study of discernible reality.’ I nodded and murmured something about enlightenment principles and empiricism. He cut me off. ‘That’s not the way the world really works anymore,’ he continued. ‘We’re an empire now, and when we act, we create our own reality. And while you’re studying that reality — judiciously, as you will — we’ll act again, creating other new realities, which you can study too, and that’s how things will sort out. We’re history’s actors . . . and you, all of you, will be left to just study what we do.'”)

But the other controversial revelation in Suskind’s book was about the Bush administration’s reckless decision after the 2002 midterms to go for a second round of tax cuts for the rich. In a January 2004 article about the book, Julian Borger wrote in the Guardian: